What happened
Shares of DraftKings (DKNG 2.68%) popped 15% on Friday after the sports-betting leader delivered impressive revenue growth and boosted its full-year financial forecast.
So what
DraftKings' revenue rocketed 81% year over year to $855 million in the fourth quarter, fueled by the launch of its Sportsbook and iGaming offerings in recently legalized markets. The company now has mobile sports-betting operations in 20 states that together account for more than 40% of the U.S. population.
Better still, DraftKings is getting better at acquiring and retaining customers. Its monthly unique paying users jumped 31% to 2.6 million. Chief Financial Officer Jason Park said DraftKings was benefiting as its competitors pared back their promotional activity in markets where sports gambling has been legalized for some time.
NASDAQ: DKNG
Key Data Points
Importantly, DraftKings also made progress toward its profitability goals. It cut its operating loss to $232 million from $369 million in Q4 2021. Moreover, DraftKings' adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) loss declined to $50 million, down from $128 million in the prior-year period.
Now what
DraftKings lifted the midpoint of its 2023 full-year revenue guidance range to $2.95 billion, up from a prior estimate of $2.85 billion. That would equate to year-over-year growth of roughly 32%.
Furthermore, DraftKings now expects to produce an EBITDA loss of approximately $400 million in 2023, which is significantly better than its previous estimate of roughly $525 million.
"Moving into 2023, we will continue to drive revenue growth and focus on expense management to accelerate our adjusted EBITDA growth," CEO Jason Robins said.
